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Where Are the Health Care Entrepreneurs?

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09/05/2012

by Dr. David Cutler, PhD, MIT

The United States lacks a culture of organizational innovation in health care. As we begin to implement the new health care law, there's a lot we can do to change that.

Health care in the United States is notorious for market imperfections. Costs are higher and outcomes worse than almost all analyses of the industry suggest are reasonable. Indeed, few other industries perform worse than health care in serving their consumers. In other industries characterized by inefficiency, efficient firms expand to take over the market, or new firms enter to eliminate inefficiencies. But such organizational innovation has been rare in health care. Two main barriers stand in the way: lack of good information on health care quality and the dominance of payment systems that reward volume of care rather than its value.

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Dr. Cutler will be delivering the Keynote Address, "The Future of Healthcare" on Wednesday afternoon at the Gaylord National next week. 
David Cutler photo

David M. Cutler - Otto Eckstein Professor of Applied Economics has developed an impressive record of achievement in both academia and the public sector. He served as Assistant Professor of Economics from 1991 to 1995, was named John L. Loeb Associate Professor of Social Sciences in 1995, and received tenure in 1997. He is currently the Otto Eckstein Professor of Applied Economics in the Department of Economics and holds secondary appointments at the Kennedy School of Government and the School of Public Health.  Professor Cutler was Associate Dean of the Faculty of Arts and Sciences for Social Sciences from 2003-2008.

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